It comes as no surprise that China made it there first. I think the next country to nationalize their crypto is the Netherlands. Check out the Gulden.
Gulden, a Netherlands-based cryptocurrency named after the now-defunct Dutch currency (the gilder), has thrived by prioritizing user experience. Now it is way ahead of its category in terms of merchant adoption, thanks to an aggressively development strategy.
In Brief
China's central bank has developed its own cryptocurrency, which is now being tested. Cryptocurrencies have the potential to not only benefit China, but the rest of the world, due to their basis in blockchain.
Benefits of Digital Currency
China’s central bank — the People’s Bank of China — has developed a prototype of a cryptocurrency that it could end up in circulation in the near future. It would be introduced alongside the China’s primary currency the renminbi (also called the yuan). China will be simulating possible scenarios and running mock transactions using the cryptocurrency with some commercial Chinese banks.
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The potential benefits of developing a digital currency are significant, particularly in China. First, it would decrease the cost of transactions, and therefore make financial services more accessible, which would be a big help to the millions of people in the country who are unconnected to conventional banks. Second, as it would be supported by blockchain, it has the potential to decrease the rates of fraud and counterfeiting, which would be of service to the government’s attempts to reduce corruption — a key concern. Third, it would make the currency easier to obtain, which would increase the rate of international transactions, allowing for more trades and faster economic growth.
The Rise of Cryptocurrencies
Since Bitcoin’s humble beginnings back in 2009 (when it was only valued at around 0.0007 USD) the digital currency, and the very idea of cryptocurrencies in fact, has grown monumentally. The total market cap of cryptocurrencies on April 1st of this year was over $25 Billion. A single Bitcoin is now worth more than $2,500. Now many national economies, as China’s plan shows, are considering the idea of developing their own variant.
Although China’s experimental approach to simulate a self-developed cryptocurrency’s usage is the first of its kind, other countries and institutions have made strides in that direction as well. The Deputy of Russia’s central bank has emphatically stated that “regulators of all countries agree that it’s time to develop national cryptocurrencies.” Over 260,000 stores in Japan will begin accepting Bitcoin as legal tender this summer, and big banks like Santander have announced plans to develop their own version.
Cryptocurrencies have the potential of revolutionizing not only the business world, but many methods of transaction. There has already been talk of using cryptocurrencies to administer Universal Basic Incomes due to their traceability, as well as for the delivery of human aid; the potential for which was demonstrated by a recent experiment to help refugees in Jordan by the UN.
References: ETH News, Forbes, MIT
This is exciting news! Throughout reading I was hoping for a name for a coin so I could rush to purchase some, but I'll do my research and find out. Thank you for the insight!
I've been searching all morning but couldn't find anything. Assuming that they haven't released the ticker yet but I'll be sure to keep an eye out. Let me know if you find anything and I'll keep you posted if I do.
Good news. I'm wondering how fair this crypto currency will be. We don't need another inflationary money, no matter if they are paper or digital.
I think like any crypto it's a question of adoption that depicts the price. If this thing is to be a nationalized currency then we'll naturally be seeing a high adoption rate. Think of China's population to get an idea of where this could go. I think it's safe to say that once released it will have nowhere to go but up. I'll be keeping an eye on this for sure.
Agree. It's worth to mention that cryptocurrency can draw price of monetary operations down. Banks won't be necessary in many cases at all.
Except this particular currency is being developed by China's central Bank. As a centralized currency, it's inevitable that banks will play a major role here.
Hope their role will be reduced and fractional reserve won't take place there. But it's hard to imagine that government will give away it's power to manipulate interest rates.
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